When it comes to credit, your score is only a small factor. You can have a 680 "beacon" and still have a repossession in your history, making you exempt from many primary lenders. If however you are 720 or above, you will get primary financing 99% of the time. A few things that Mazda American Credit looks at, and trust me on this, they have tightened up in the past few months. They look at debt to income, auto credit (been late before on car payments), and they WILL make phone calls to verify employment. CLOSE DOWN THOSE CREDIT CARDS YOU FOOLS!!! A salesman is NOT a credit advisor!! He can't even tell you your score.
Debt to income is basically this:

INCOME (Pre-tax) - (rent or mortgage, credit card limits, other vehicles in your name)

If your credit cards have no balance IT DOES NOT MATTER!!!!, they look at them as if they are maxed to the limit because you can do that right after the purchase.

REMEMBER, a salesman has to sell you the car to make a living, so if he tells you something like you need more down, and you dont believe him, and you leave, he was right, you were wrong. Its not the dealership but the banks who are telling you this.

 

nope sorry, cards without balances don't factor into the equation. They aren't considered with any lending institution I know of(mortgage, revolving, or auto).

Debt to income is a ratio, nto a difference.

Total of your dents/ total income. That's a divided by symbol, not a subtraction. Yes, it is becoming increasingly important.

Payment to income is also important, that is:
Proposed Payment/ total Income. Many banks want that to be around 1/6th or lower. or roughly 15-17%.

beacon Score can be deceiving, and can matter littele, depending on the bank of choice. However a prime lender like Wachovia, looks almost exclusively at score, besides Major Derogatory items. Major Derogs are Foreclosure, Reposession and Bankruptcy.

Wachovia in particular is prone to offering top tier lwo rates to thin credit files. A thin Credit file is typical of a young adult with few accounts, no previous auto history, and no mortgage.


A salesman could jsut as easily be asking for more money down to increase his profit while still reaching your payment goals, it could go either way, jsut as easily it could be the bank requiring it.

 

while the lenders may not look at credit balance, the more cards you have, it will effect your score.

One thing that is happening, lenders like Wells Fargo are actually factoring cost of gas into your income/debt!! So, if you are buying a car and you are at the limit (17% of your income will go to car payment) and then they factor in the gas cost, so sorry, out of luck.

I work in a dealership, I am not using this website to sell myself, but I want to see more RX-8s out there cause I love the car.

You are right to a point on the down payment, sometimes that increases the commission, but the bottom line is that the typical Mazda has such little mark-up you end up with minimal commissions anyway. I've had people put down 10g's on a 18k car and it didn't effect my commission one red cent.

Feel free to ask what trends we as dealerships are seeing on our side of the table. In the past few months things have gone crazy. I want to help anyone get into their RX-8's.

 

one quick point, saying that debt to income is a ratio and not a sum is basically the same thing. It's easier to lay your expenses out as a sum than do the ratios for most people. 17% was about the most for the avg buyer.......2 months ago, ist about 13% now, which will get better in time.